This appeal has been filed by the appellant Oriental Insurance Company Limited against the order dated 05.02.2014 of the State Consumer Disputes Redressal Commission, Punjab, (in short ‘the State Commission’) passed in CC No.69 of 2010.

2.      This matter was listed before the Circuit Bench at Chandigarh on 22.01.2020 and notice was issued to all the parties by the Registry of this Commission.  It has been reported that the respondent as well as the learned counsel for the respondent, both have been served with notice.  However, none is present on behalf of the respondent even on the second call and therefore, the learned counsel for the appellant was heard.

3.      Brief facts of the case are that the complainant is engaged in manufacturing of Cephalosphorin Active Pharmaceutical Ingredients and Finished Dosage Forms.  The complainant had obtained a standard fire insurance cover for its unit from the opposite party from 06.05.2009 to 05.05.2010.  On 21.05.2009 during ‘A’ shift when Chemical ingredients for batch processing to produce Leaf Acetate were charged in one of the reactors at around 1340-1345 hours an abnormal breaking/bursting sound of glass pipeline was heard and it was found that there was sudden accident of bursting of apparatus i.e. glass pipeline/reducer of the reactor.  The complainant lodged a claim of Rs.25,38,115/- vide its letter dated 16.7.2009. Opposite party repudiated the claim on the ground that the bursting and over flowing of water tanks and apparatus and pipes is not attracted in the present case.

4.      The learned counsel for the appellant stated that the State Commission has allowed insurance claim of the complainant as per the assessment done by the surveyor, however, the claim itself is not payable.  It was stated that the claim has been allowed on the basis of application of the following peril namely:

“Bursting and/or overflowing of Water Tanks, Apparatus and Pipes”

5.      Learned counsel stated that this peril is only in respect of water and other chemicals cannot be covered under this peril.  Learned counsel also referred to some clarification given by the Insurance Company under this clause which reads as under:-

“Bursting and/or overflowing of Water Tanks, Apparatus and Pipes

20. As the name suggests, the cover is for damage to property due to bursting/or overflowing of water tanks/apparatus and pipes.  This is largely applicable to cold regions where busing of pipes takes place.  Any damage caused to the property insured by bursting or overflowing of overhead water tank and pipes is covered.”

6.      On the basis of the above clarification, the learned counsel asserted that said peril only relates to damage due to bursting of water pipes or overflowing of water tanks.

7.      I have carefully considered the arguments advanced by the learned counsel for the appellant and examined the material on record.  First of all, it is seen that there is a delay of 18 days in filing the present appeal.  As the delay is less than a month, the same is condoned on the ground mentioned in the application for condonation of delay. The peril can be read in two parts.  The first part is “bursting and/or overflowing of water tanks” and the second part will be read as “bursting and/ or overflowing of apparatus and pipes”.  Clearly in the second part, there is no reference to water.  Thus, the peril relates to bursting or overflowing of water tanks, but it also relates to bursting of apparatus and pipes and the same may be due to any reason.  This Commission in The Divisional Manager, United India Insurance Co. Ltd. Vs. Bidar Sahakari Sakkare Karkhane Ltd. & Anr. FA No.415 of 2011, decided on 24.06.2016 has allowed the loss of molasses under this peril as there was leakage from the pipe.  The judgment reads as under:-

“5.   It is evident from the report of the surveyor that molasses had leaked from the tank due to rupture of the nipple of the said tank. Since the nipple had been welded to the tank near its bottom, it became a part and parcel of the tank itself. Therefore, it can hardly be disputed that a rupture of the tank had resulted in leakage of molasses from it. The surveyor took the view that since the rupture of the nipple could be due to metal fatigue or due to week welding joint or rusting, the claim was not covered under the insurance policy. In our opinion, in case there is no difference between the rupture and bursting, the claim would be covered under the policy, as the bursting/rupture, irrespective of the cause of the said rupture/bursting, was one of the insured perils. It is immaterial whether the rupture/bursting took place due to weakening of joint, due to metal fatigue, rusting or any other reason. Once it is shown that there was a bursting/rupture of the nipple which had resulted in the loss to the complainant, such a loss would be covered under the insurance policy.”

8.      From the above, it is clear that bursting of pipe does not only relate to water, but it may relate to any other substance.  Hence the view taken by the State Commission seems to be correct and I do not find any reason to interfere with the order passed by the State Commission.  Accordingly, First Appeal No.187 of 2014 is dismissed.